EUR/CZK likely at 27.40 in absence of Greece impact

Better economic performance of  Czech Republic should be supportive of the local currency. However, as the exchange rate has moved closer to the CNB's floor, the central bankers may try to speak up and verbally intervene to weaken the crown. 

According to Societe Generale, "The situation in Greece should have no sizeable impact on the Czech economy, than the CNB will expect EUR/CZK within the range of 27.30-27.50. We continue to expect the spot at 27.40 at endQ3 and 27.30 as of the end of the year." 

A greater risk for the Czech Republic, however, is the Greece-related stress of an increase in risk aversion or a drop in confidence via the rest of Europe. However, as the relatively calm response of financial markets toward the announcement of the Greek referendum have showed, the risks seem far lower compared with the situation just a few years ago.